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What Can We Learn from Zappos About Hiring?

February 19, 2015

ShoesZappos, the online shoe, clothing, and accessories company, has been known to have a very unique culture and set of values. For example, one of their core values is to “Create Fun and A Little Weirdness.” Their values focus on creating an open and positive environment so excellent service can be delivered. In their interviewing process, they ask candidates targeted questions around their core values to ensure that they will fit in with the company. Additionally, one unique practice they incorporate into their selection/onboarding process takes place immediately after hiring individuals. Once the employee comes on board, they participate in a two-week training program. At the end of this period, employees have the opportunity to “opt out” from the company without any penalty. If they decide the job and company isn’t right for them, they will be paid for their time spent in training and also receive a month’s worth of salary for withdrawing. At first this seems counterintuitive…Zappos would voluntarily pay employees a bonus of a few thousand dollars to leave the company?!?

As we know and have talked about previously, the best indicator of an effective selection system is the ability to accurately differentiate between candidates who will be successful on the job and those who will be unsuccessful on the job. This is what we strive to achieve when creating and customizing the hiring process for positions. However, another sign of an effective selection system is the ability to naturally weed out candidates who will likely not thrive or be happy in the job environment. The first indicator gives hiring managers the ability to select who will do best in the role. Alternatively, the second indicator allows candidates the ability to withdraw themselves from the selection process if they feel the job is not right for them. This is exactly what Zappos is incorporating into their hiring and onboarding process.

Implementing this idea in your company

In Industrial/Organizational Psychology-speak, we call this a realistic job preview, or RJP. An RJP provides information about the job and the company that an employee may find satisfying and dissatisfying. It highlights both the good and the bad. For example, if the company offers a great benefits package, you’ll want to mention this. Similarly, if it’s known that employees will be working in really hot or cold temperatures, you’ll want to mention this too. The RJP eliminates the element of surprise on the first day of work. RJPs should set realistic expectations. The main goal of RJPs is to provide candidates the information they need to make a decision on whether they would be happy in the role. We’d much rather individuals select out of the job earlier in the process so we do not invest a lot of time and resources in them.

There are several ways that you can incorporate an RJP into your hiring process, which range from basic to more involved. The first way is as simple as including a question in the initial application. For example, if employees will be required to work overtime on occasion, you could ask candidates if they are willing to work overtime. While very basic, it gives individuals a sense of what to expect. Another way is to incorporate an RJP into the interview. Interviewers can talk more about the job and what is it like to work with the company. This allows candidates the opportunity to hear the ins and outs as well as to ask questions they may have. A third way, which is more involved but is also higher in fidelity, is to show candidates a video of employees on the job doing their work. The video would show the typical working environment and requirements for the role. For example, the video could portray an employee picking up large boxes, taking them out to the truck in the cold weather, and driving off. This provides candidates a much better feel of what to expect.

Zappos is providing new employees a high fidelity RJP during the training period. New employees are immersed in the environment and perform some of the tasks of the job. They are able to experience some of the highs and lows of the job and organization. This provides employees a good opportunity to decide whether they will be happy in the position. Zappos wants to make sure that employees fit in with the culture before they invest too much time and resources into them. Giving them the opportunity to back out without a cost is one way to do that.

Put it into perspective

The US Department of Labor and Statistics found that the average cost of a poor hiring decision is 30% of the employee’s first-year potential earnings. So, the first month’s salary that Zappos is offering seems fairly reasonable. While it’s not realistic to do this with all positions, including elements of an RJP—whether it be fairly simple or more involved—can help to ensure you are hiring individuals who will be more satisfied with the job and organization no matter what challenges are presented.

The Ultimate Hiring Manager’s Guide


Alissa Parr, Ph.D. Alissa Parr, Ph.D. is a Senior Consultant at PSI. Her areas of expertise include the development, implementation, and evaluation of assessment processes. Alissa has experience managing entry-level through executive level assessment and selection efforts across a number of different industries including government, financial, military, education, healthcare, and manufacturing.